Do I Need a Family Financial Advisor?

August 9, 2021

Expanding a family can bring a lot of financial questions to the forefront for parents. Should we start college funds? Can we afford to take substantial time away when the baby is born? What if we want to purchase a larger home? The list expands with each passing year. Planning for more people is a lot different than personal budgeting or even financial planning for a couple. There is a lot to learn and know and you may start wondering “Do I need a family financial advisor?”

As with everything else in the parenting journey, information is power. This includes deciding if hiring a family financial planner is the right thing or if this is the right time to do so. This “getting started” guide will help you determine if this is the course you want to take right now, and where to target your search for financial support.

What is family financial planning?

Family financial planning allows you to set money-related goals for your future and then achieve them. Effective planning will help you to target the goals you value the most, create timelines for reaching certain targets, and realistically allocate your income each month.

Some areas that you can address with family financial planning:

  • retirement funds
  • paying off a mortgage
  • family vacations
  • college funds
  • future parental leave
  • childcare options
  • general budgeting
  • debt management and repayment

But do I need a family financial advisor? Can’t I do the planning myself?

Maybe. With a lot of digging and discipline, you can plan and budget for your family’s needs. But a family financial advisor is going to bring a lot of knowledge about the best ways to do things and a lot of insight into new ways of doing things. Those without a professional background in finances will have limited access to information about options, a family financial advisor will help you make sure not to miss anything.

And let’s face it, most parents are already juggling so much. Are you really able to add taking it upon yourself to create a financial road map for your family that takes all of your goals into account? Hiring a family financial advisor or consulting with one will simply ensure that you get the job done.

There is also the confidence aspect. A family’s finances are often complex. They can weigh on parents and cause stress. The stress can be amplified if you are unsure that you are doing things right, put it off, or don’t think things through. A family financial advisor will support you to create a plan that will work with where you are right now and with what you can realistically commit to.

Different types of family financial planning support

If you think you would benefit from using a financial advisor, it is important to find someone who is best suited to your goals, needs, and even comfort level. While using the title “financial advisor” requires no particular certifications, many financial advisors do have training and credentials that differ from each other. There are three titles and a handful of certifications that you are likely to come across in your search. Here’s an overview of what you can expect from each to make things easy as you get started.

The difference between a financial advisor, a certified financial planner, and a certified financial counselor?

Financial Advisor

Simply put, a financial advisor is someone you can pay to help to provide financial advice. They may help with taxes, investment management, and general planning. They may work independently or for a company. A person working as a financial advisor is likely to have at least one certification, though it is not state or federally required. You may want to ask about their training to get a sense of what they specialize in. Some common certifications are listed below.

Certified Financial Planner

Those working professionally as certified financial planners are required to undergo training and examinations to use the title. Those certified by the Certified Financial Planner Board, for instance, meet extensive and specific training and ethical standards and are required to renew their accreditation regularly.

Financial Counselor

A financial counselor provides support that may be considered more “basic” than an advisor or accountant and may be a good place to begin if you are new to financial planning. Financial counselors help with budgeting, saving, addressing debt, improving credit scores, and money management. They may or may not have certifications.

Titles, terms, and training

The following are the most common titles you will come across on your search for a family financial advisor

Accrediting Financial Counselor (AFC®)

Professionals who provide education and guidance on budgeting, debt management, money management, and retirement planning.

Certified Financial Planner (CFP®)

Experts in insurance, investments, taxes, estate planning, and retirement planning.

Certified Public Accountant (CPA)

Although generally known for providing tax services, some CPAs also have a special distinction – Personal Financial Specialist – that gives them the additional expertise to offer personal financial planning services.

Registered Investment Advisor (RIA)

A registered investment adviser manages or invests money on behalf of clients.

If you think you need a family financial advisor, you probably do

Bottom line: if you are expanding your family, thinking about financial goals, or wanting to feel more secure about plans for the future, you may need a family financial advisor. At the very least a professional can help you to begin taking steps in the right direction.

If it feels overwhelming, just start small and begin with a conversation that helps you to get clear on your long-term vision.

Planning for a new baby? Want support around planning for maternity leave or starting to save for what’s to come? Contact me to chat about my coaching support.

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